RWE : Emission Inventory & Methodology 2022

Greenhouse Gas

Emission Inventory &

Calculation Methodology

Quantification and reporting of greenhouse gas emissions in accordance with the Corporate Greenhouse Gas Protocol

June 2022

Executive Summary

Greenhouse gases (GHG) trap heat and make the planet warmer. The resulting change of our climate is one of the defining issues of our times. RWE is acting: As an electricity-generating company, the majority of our emissions are currently still so-called direct greenhouse gases (Scope 1). In recent years, we have managed to reduce these emissions considerably through the decommissioning of power plants, new technology and innovation, and efficiency measures. We are continuing along this path – with our strategy “Growing Green” we want to become greener and more profitable. The expansion of renewable energy is one of the most important keys to this. Our long-term goal: Net Zero by 2040 – for both direct and indirect emissions. RWE is committed to the targets of the 2015 Paris Agreement: Limiting global temperature increase to well below 2 degrees Celsius above pre-industrial levels, while pursuing efforts to limit the increase to 1.5 degrees.

For RWE it all starts with transparency on our emissions. This document outlines our key rationales in accounting our greenhouse gas emissions. The inventory is based on the results of a group-wide assessment in 2020 and will be reviewed on a regular basis. This process is steered by the Group sustainability team at RWE AG and conducted in close collaboration with relevant functions within RWE Group. Emissions have been part of our external reporting for years: The first reporting using the internationally renowned Greenhouse Gas Protocol Standard has been in 2009. Based on this methodology we publish GHG figures on an annual basis.

Introduction

In the past century the concentration of greenhouse gases in the atmosphere has grown. As such increasing greenhouse gas emissions pose a threat to the wellbeing and welfare of humankind. Global warming has diverse negative impacts such as rising sea levels, increased risks of flooding, drought and other extreme weather events. The reports of the Intergovernmental Panel on Climate Change (IPCC) show this impressively. Together with the goal of the Paris Climate Agreement, they form an important basis for our action and transformation.

At the 2015 Climate Summit in Paris the international community agreed to limit global temperature increase to well below 2 degrees Celsius, while pursuing efforts to limit the increase to 1.5 degrees. This can only be achieved if global greenhouse gas emissions are rapidly reduced. RWE’s purpose is to provide energy for a sustainable life. We recognize the responsibility of our sector to enable the transition to a low-emissions future. Part of this responsibility is transparency on our corporate emissions footprint. Understanding our own footprint is crucial to steer our way into a sustainable future, to engage with internal and external partners and stakeholders and take appropriate steps to keep cutting emissions.

This document outlines RWE’s approach in accounting greenhouse gas emissions. It describes the calculation boundaries, methodologies, assumptions and key references used in the preparation of our RWE emission inventory. We are using the internationally

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renowned Greenhouse Gas Protocol Corporate Standard and its additional guidance docu- ments. The Greenhouse Gas (GHG) Protocol is a multi-stakeholder partnership of busi- nesses, nongovernmental organizations (NGOs), governments, and others convened by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD). Launched in 1998, the GHG Protocol seeks to develop internationally accepted GHG accounting and reporting standards and tools to promote their adoption worldwide.

The inventory presented in this document is the outcome of a recent assessment that helped us to identify the most relevant sources and categories of emissions within our corporate value chain.

Climate Transition and Action

The power sector accounts for nearly 40% of global energy emissions (IIGCC 2021). It shows the impact of the industry for the achievement of any national and international tar- gets. At RWE we have a sound approach on how we want to enable the climate transition of our company. This encompasses the following aspects:

– Governance: RWE has an effective climate governance structure with the CEO responsible for climate-related issues, management and reporting. Climate targets for RWE are set by the Executive Board of RWE AG, the same holds for the overall business and sustainability strategy that include climate-related elements. With energy policy and strategy issues closely linked to climate issues for many years, our supervisory and management bodies bring extensive expertise and assessment capabilities to the table. As part of an integrated compliance reporting, the Executive Board and the Audit Committee of the Supervisory Board are regularly informed about climate -related risks and opportunities. In addition, the Executive Board of RWE AG is incentivized to continue reducing the CO2 intensity of the power plant portfolio. This figure is linked to our long-term target to be Net Zero by 2040.

• Strategy: Our strategy and capital allocation is aligned with our goal to be net zero by 2040. To this end, we will rapidly expand electricity production from renewable energies, make more use of storage technologies and use CO2-neutral fuel to pro- duce electricity. With our strategy ‘Growing Green’, RWE is massively stepping up the pace and is investing €50 billion gross in its core business until 2030. That means an average of €5 billion gross each year for offshore and onshore wind, solar, batteries, flexible generation and hydrogen. Almost 90% of our capital expenditures is eligible with the proposed green investment criteria of the EU taxonomy. We made clear that will no longer invest in any new or existing coal-projects.
  On the political level we have published core climate advocacy positions that state the importance we put in further ambitious steps to tackle climate change. Amongst others they outline our support for the Paris Climate Agreement and our position on the accelerated expansion of renewable energies for an even faster transition away from fossil power generation. We also expect that our industry associations are in

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